Chief financial officer William Aylesworth said Wednesday that the market for semiconductors remains difficult. The Semiconductor Industry Association reported that worldwide sales in September were 41 percent lower than a year earlier.

Sales of chips for wireless devices are improving, Aylesworth said at an investment conference in New York.

Aylesworth said Texas Instruments will cut capital spending next year to no more than $1.2 billion, down from $1.8 billion this year. The company said it would delay installation of new manufacturing equipment.

On Thursday, UBS Warburg analyst Thomas Thornhill cut his estimate of Texas Instruments' 2002 earnings in half, to 4 cents per share. He predicted flat sales in the first quarter with improvement later in the year.

In October, the Dallas-based company said it lost $117 million in the third quarter after earning $679 million in the same quarter of 2000. Shares of Texas Instruments, which rose 72 cents on Wednesday, rose 81 cents to $28.80 in morning trading Thursday on the New York Stock Exchange.